Correlation Between T-MOBILE and Media

Can any of the company-specific risk be diversified away by investing in both T-MOBILE and Media at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining T-MOBILE and Media into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between T MOBILE INCDL 00001 and Media and Games, you can compare the effects of market volatilities on T-MOBILE and Media and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in T-MOBILE with a short position of Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of T-MOBILE and Media.

Diversification Opportunities for T-MOBILE and Media

0.8

Correlation Coefficient

T-MOBILE  Media

Very poor diversification

The 3 months correlation between T-MOBILE and Media is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding T MOBILE INCDL 00001 and Media and Games in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Media and Games and T-MOBILE is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on T MOBILE INCDL 00001 are associated (or correlated) with Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Media and Games has no effect on the direction of T-MOBILE i.e., T-MOBILE and Media go up and down completely randomly.

Pair Corralation between T-MOBILE and Media

Assuming the 90 days trading horizon T-MOBILE is expected to generate 1.24 times less return on investment than Media. But when comparing it to its historical volatility, T MOBILE INCDL 00001 is 1.71 times less risky than Media. It trades about 0.1 of its potential returns per unit of risk. Media and Games is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  318.00  in Media and Games on December 21, 2024 and sell it today you would earn a total of  38.00  from holding Media and Games or generate 11.95% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	98.33%
Values	Daily Returns

T MOBILE INCDL 00001  vs.  Media and Games

T MOBILE INCDL

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in T MOBILE INCDL 00001 are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile basic indicators, T-MOBILE unveiled solid returns over the last few months and may actually be approaching a breakup point.

Media and Games

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Media and Games are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile technical and fundamental indicators, Media unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with T-MOBILE and Media

The main advantage of trading using opposite T-MOBILE and Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if T-MOBILE position performs unexpectedly, Media can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Media will offset losses from the drop in Media's long position.

The idea behind T MOBILE INCDL 00001 and Media and Games pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Equity Valuation module to check real value of public entities based on technical and fundamental data.